Health Care Costs

Financing the efficient delivery of medical services while reducing costs for consumers as well as health care providers is among the most challenging domestic policy problems many countries face. RAND addresses health economics issues through innovative, high-profile research in an effort to improve the efficiency of health care organizations, reduce costs for providers and consumers, and improve financing in health care markets.

Research conducted by: RAND Health

Featured at RAND

Four Strategies to Contain America's Growing Health Care Spending

pills and coins

In its second term, the Obama Administration can restrain further health care spending growth—without compromising quality—by employing four broad strategies: fostering efficient and accountable providers, engaging and empowering consumers, promoting population health, and facilitating high-value innovation.

Cost and Coverage Implications of the Affordable Care Act

scalpel cutting dollar

The ACA's goal of expanding access to health coverage has implications for health care costs at many levels: how it will affect individual decisions to obtain insurance, employer decisions about offering coverage, and government spending.

Journal Articles (221)

Cost Effectiveness, Chemotherapy, and the Clinician — Apr 1, 2009

Economic evaluations of health care can be used by policy makers and other decision makers to compare the cost effectiveness of different treatment strategies and to make decisions about the allocation of scarce resources, such as dollars spent on health care.

Taking Stock of Pay-for-Performance: A Candid Assessment from the Front Lines — Mar 15, 2009

Pay-for-performance (P4P) has been widely adopted, but it remains unclear how providers are responding and whether results are meeting expectations.

Pay for Performance in the Hospital Setting: What Is the State of the Evidence? — Jan 15, 2009

More than 40 private sector hospital pay-for-performance (P4P) programs now exist, and Congress is considering initiating a Medicare hospital P4P program. Given the growing interest in hospital P4P, this systematic review of the literature examines the current state of knowledge about the effect of P4P on clinical process measures, patient outcomes and experience, safety, and resource utilization.

Costs and Benefits of Health Information Technology: New Trends from the Literature — Jan 1, 2009

To understand what is new in health information technology (IT), the authors updated a systematic review of health IT with studies published during 2004-2007. From 4,683 titles, 179 met inclusion criteria. They identified a proliferation of patient-focused applications although little formal evaluation in this area; more descriptions of commercial electronic health records (EHRs) and health IT systems designed to run independently from EHRs; and proportionately fewer relevant studies from the health IT leaders. Accelerating the adoption of health IT will require greater public-private partnerships, new policies to address the misalignment of financial incentives, and a more robust evidence base regarding IT implementation.

Early Results from Thailand's 30 Baht Health Reform: Something to Smile About — Jan 1, 2009

Efforts by countries to attain universal coverage are often hampered by supply constraints that can reduce access to care for those already in the system and, in many Asian and developing countries, by the emergence of informal payment systems that extract under-the-table payments from patients. In 2001, Thailand extended government-financed coverage to all uninsured people with little or no cost sharing.

Effects of Payment Changes on Trends in Post-Acute Care — Jan 1, 2009

Test how the implementation of new Medicare post-acute payment systems affected the use of inpatient rehabilitation facilities (IRFs), skilled nursing facilities (SNFs), and home health agencies.

The Geographic Distribution, Ownership, Prices, and Scope of Practice at Retail Clinics — Jan 1, 2009

Cross-sectional descriptive study describes characteristics of retail clinics, including their location, scope of practice, prices, acceptance of insurance, and ownership, and to estimate the proportion of the U.S. population that lives within a short driving distance of such a clinic.

Insurer Bargaining and Negotiated Drug Prices in Medicare Part D — Jan 1, 2009

The authors test whether insurers that experience larger enrollment increases due to Medicare Part D negotiate lower drug prices with pharmacies. Overall, the authors find that 100,000 additional insureds lead to 2.5-percent lower pharmacy prices negotiated by the insurer, and 5-percent reductions in pharmacy profits earned on prescriptions filled by enrollees of that insurer.

Potential Societal Savings from Reduced Sodium Consumption in the U.S. Adult Population — Jan 1, 2009

Cross-sectional simulation scenarios were developed to estimate the effect of hypertension prevalence, direct medical costs, and quality of life years (QALYs) saved by reductions in sodium consumption. Population-level data on blood pressure, antihypertensive medication use, and sodium intake were from the National Health and Nutrition Examination Survey 1999-2004.

Hospital Market Consolidation: Trends and Consequences — Jan 1, 2009

Examines the effects of hospital consolidation on hospital costs and prices to consumers.

Controlling U.S. Health Care Spending--Separating Promising from Unpromising Approaches — Jan 1, 2009

The reform legislation moving through Congress includes both promising and unpromising approaches to limiting health care spending.

Aging in America in the Twenty-First Century: Demographic Forecasts from the MacArthur Foundation Research Network on an Aging Society — Jan 1, 2009

Life expectancy for U.S. men and women in 2050 may be higher than predicted in official government forecasts, with the result that the costs of Medicare and Social Security could be significantly higher than currently estimated.

Waste in the U.S. Health Care System: A Conceptual Framework — Dec 1, 2008

Proposes a conceptual framework to guide researchers and policymakers in evaluating waste in the U.S. health care system, implementing waste-reduction strategies, and reducing the burden of unnecessary health care spending.

Paying the Price at the End of Life: A Consideration of Factors That Affect the Profitability of Hospice — Sep 1, 2008

Evaluates factors that affect the financial performance of hospice.

High-deductible Health Plans and Better Benefit Design — May 1, 2008

Advocates of high-deductible health plans, which shift more of the cost of care to individuals, believe that consumers will more carefully assess the balance of health care benefits versus costs, ultimately improving efficiency and quality of care.

The Incremental Inpatient Costs Associated with Marijuana Comorbidity — Jan 1, 2008

In this paper the authors examine the incremental cost of marijuana comorbidity for alcohol, mood and thought diagnoses in hospital settings.

Hospital Pricing and the Uninsured: Do the Uninsured Pay Higher Prices? — Jan 1, 2008

Uses data from California to compare actual prices paid by uninsured patients with prices paid by commercial and Medicare patients. Uninsured patients pay prices similar to those of Medicare patients, and hospital prices to the uninsured have risen.

Employers' Health Insurance Cost Burden, 1996-2005 — Jan 1, 2008

Data from the Employment Cost Index show that health insurance costs relative to payroll increased 34 percent between 1996 and 2005 and that the increase was largest for businesses paying low wages; simultaneously, data from the Employee Benefits Survey show that benefit packages became less generous, yet cost growth was not paralleled by a commensurate decrease in employer offers.

Health Services Research — Jan 1, 2008

Examines the discipline of health services research. Often loosely referred to as outcomes research, it is primarily focused on the study of access to care, costs of care, and quality of care.

Financial Incentives for Quality in Breast Cancer Care — Jan 1, 2008

Most breast cancer care providers in Los Angeles County outside of staff- or group-model HMOs are not subject to explicit financial incentives based on quality-of-care measures. New approaches are needed to direct incentives toward these specialists.

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